JM Smucker Company (SJM)
Cash ratio
| Apr 30, 2025 | Jan 31, 2025 | Oct 31, 2024 | Jul 31, 2024 | Apr 30, 2024 | Jan 31, 2024 | Oct 31, 2023 | Jul 31, 2023 | Apr 30, 2023 | Jan 31, 2023 | Oct 31, 2022 | Jul 31, 2022 | Apr 30, 2022 | Jan 31, 2022 | Oct 31, 2021 | Jul 31, 2021 | Apr 30, 2021 | Jan 31, 2021 | Oct 31, 2020 | Jul 31, 2020 | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash and cash equivalents | US$ in thousands | 69,900 | 47,200 | 49,200 | 39,500 | 62,000 | 35,900 | 3,623,900 | 241,100 | 655,800 | 104,200 | 27,100 | 151,600 | 169,900 | 284,300 | 155,300 | 168,800 | 334,300 | 501,500 | 405,600 | 396,600 |
| Short-term investments | US$ in thousands | — | — | — | — | 0 | 0 | 432,700 | 459,800 | 487,800 | — | — | — | — | — | — | — | — | — | — | — |
| Total current liabilities | US$ in thousands | 2,652,000 | 3,289,400 | 3,563,200 | 3,764,000 | 3,761,100 | 2,467,400 | 1,834,400 | 1,947,200 | 1,986,700 | 1,740,700 | 2,059,700 | 2,177,200 | 1,952,800 | 1,664,600 | 1,890,500 | 2,763,200 | 2,867,500 | 2,532,400 | 2,692,800 | 2,073,100 |
| Cash ratio | 0.03 | 0.01 | 0.01 | 0.01 | 0.02 | 0.01 | 2.21 | 0.36 | 0.58 | 0.06 | 0.01 | 0.07 | 0.09 | 0.17 | 0.08 | 0.06 | 0.12 | 0.20 | 0.15 | 0.19 |
April 30, 2025 calculation
Cash ratio = (Cash and cash equivalents + Short-term investments) ÷ Total current liabilities
= ($69,900K
+ $—K)
÷ $2,652,000K
= 0.03
The analysis of JM Smucker Company's cash ratio over the specified period reveals significant fluctuations, reflecting variations in the company's liquidity position at different points in time. The cash ratio, which measures the company's ability to cover its current liabilities using only its cash and cash equivalents, ranged from a low of 0.01 to a high of 2.21 during this span.
Between July 31, 2020, and October 31, 2022, the company's cash ratio experienced a general declining trend, decreasing from 0.19 to a low of 0.01. This suggests that the company's cash holdings relative to its current liabilities diminished markedly during this period, possibly indicating increased use of cash for operational needs, debt repayment, or reinvestment activities, or a strategic decline in cash holdings.
A notable deviation occurred in the period ending April 30, 2023, when the cash ratio surged sharply to 0.58, suggesting a substantial increase in cash reserves relative to current liabilities. This spike was followed by an even more pronounced increase to 2.21 as of October 31, 2023, indicating an extremely robust liquidity position at that time. Such elevated cash ratios may reflect a strategic accumulation of cash, a response to upcoming capital needs, or conservatism in liquidity management.
Subsequently, the cash ratio declined sharply once again, dropping to 0.01 by January 31, 2024, and remaining at or near this minimal level through the subsequent periods measured up to October 31, 2025. These very low figures imply that, at these later dates, the company's cash holdings were insufficient to cover its current liabilities solely with cash, perhaps indicating increased reliance on other liquid assets or operational liabilities.
Overall, the fluctuations in JM Smucker’s cash ratio demonstrate periods of liquidity tightening and significant cash accumulation, particularly in late 2023, followed by a rapid reduction in cash holdings. This pattern suggests a strategic, possibly cyclical approach to liquidity management, aligning cash holdings with operational needs, strategic initiatives, or macroeconomic considerations.